Highfield Resources Limited · ASX:HFR
Highfield Resources — Investor Presentation (March 2022)
27 slides from Highfield Resources's investor presentation, March 2022
Slide 1: Constructing the Next European Potash Mine
Constructing the Next European Potash Mine Corporate Presentation March 2022 ASX: HFR
Slide 2: Competent Persons Statement for Muga Ore Reserves and Mineral Resources
COMPETENT PERSONS STATEMENT FOR MUGA ORE RESERVES, MUGA MINERAL RESOURCES and EXPLORATION TARGET This update was prepared by Mr. Ignacio Salazar Director of Highfield Resources. The information in this update that relates to Ore Reserves is based on information prepared under the direction of Dr Mik
Slide 3: Global Potash Prices on the Move at the Right Time
Global Potash Prices on the Move at the Right Time Strong market fundamentals Upward price forecasts 700 2.0 10.0 8.0 600 Soybean prices are the Billions of tonnes 1.5 Billion 6.0 highest in 5 years USD/t 1.0 500 4.0 0.5 2.0 400 0.0 0.0 1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013 201
Slide 4: An Investment Opportunity in the Next Major European Potash Mine
An Investment Opportunity in the Next Major European Potash Mine Muga Potash Mine Highfield Resources Strong market fundamentals Strong financial position and Global potash prices on the move financial markets support Location is a major strategic advantage Experienced Management Shallow mineralizat
Slide 5: Corporate Snapshot
Corporate Snapshot Capital Structure Share Price (30 March 2022) $1.03 1.20 60 Shares on Issue 364.4 million 1.00 50 Options & Performance Rights - Volume (100,000 shares) Market Capitalisation $375.33 million 0.80 40 Share price (A$) Cash (31 December 2021) $22.24 million Drawn Debt* - 0.60 30 Ente
Slide 6: Strong Board with Global Mining Industry Experience and Robust Governance Processes
Strong Board with Global Mining Industry Experience and Robust Governance Processes Paul Harris Ignacio Salazar Independent Non-Executive Director MD & Chief Executive Officer Chairman Paul has over 25 years’ experience in financial markets Ignacio has over 30 years’ experience, most of which and in
Slide 7: Management with strong mining experience and local background
Management with strong mining experience and local background Javier Aguado Susana Bieberach Chief Financial Officer Public Affairs Javier has over 20 years’ accounting and financial 15 years of experience in communication and CSR Ignacio Salazar experience. He has worked for Ernst and Young and fie
Slide 8: Muga Project Overview
Highfield 7 Resources MUGA PROJECT OVERVIEW
Slide 9: Highfield Resources and the Muga Project
Highfield Resources and the Muga Project Conventional Underground A potash developer listed on Muga is a two phase project Room and Pillar mining. Conventional Flotation and the ASX (HFR) with projects which will produce a total of Declines accessing shallow Crystallisation processing in Northern Sp
Slide 10: A Major Industrial Project
A Major Industrial Project GEOLOGY: The geological characterisation of Muga has been determined from 40 drillholes, separated approximately 1 km from each other UNDERGROUND MINE - Access to mineralisation at 350m depth through two ramps (6m wide x 5m high) of 2.6km length - 50km of rooms - Undergrou
Slide 11: Shallow Mineralization, Conventional Mining, with Tier-One Infrastructure in Place
Shallow Mineralization, Conventional Mining, with Tier-One Infrastructure in Place 350m Decline access to shallow mineralization; Close to the Port of Bilbao (~220km), underground Room and Pillar mining. No aquifers Spain’s largest port First class infrastructure and National Electricity Grid Substa
Slide 12: Significant Logistical Competitive Advantage
Significant Logistical Competitive Advantage Extremely competitive and versatile export options ~1,750km from mines to port ~1,700km from mines to port Muga will be one of only two potash mines located in Southern Europe ~130- 220km from ~6,800 nautical miles mine to ports ~8,700 nautical miles ~5,0
Slide 13: MOU signed for more than phase 1 production
MOU signed for more than phase 1 production MOP sales (pa) Wider Europe: Salt sales (pa) • ~250-300 kt MOP • ~200-250 kt salt US East Coast: • ~50 kt MOP Local: • ~200-250 kt salt Potash MOUs signed • ~450-500 kt MOP • ~400-500 kt salt MOP Ameropa 250,000 tpa Africa: Keytrade 300,000 tpa • ~50 kt MO
Slide 14: Project Economics
Highfield 7 Resources PROJECT ECONOMICS
Slide 15: Top Quartile Margins in the Industry
Top Quartile Margins in the Industry European prices continue to trade at a premium to Margin curve forecast for 2024 (real US$) other markets 750.0 200 650.0 150 550.0 100 450.0 50 US$/t 350.0 00 250.0 0 10 20 30 40 50 60 70 150.0 -50 2016 2017 2018 2019 2020 2021 2022 -100 Millions of tonnes of M
Slide 16: Low Capex Intensity and Strong Project Economics
Low Capex Intensity and Strong Project Economics Phase 1 capex of €398 million + Phase 2 capex of €209 million MUGA: HALF THE CAPEX INTENSITY OF OTHER GLOBAL DEVELOPMENT PROJECTS (US$ per tonne of potash) 2,000 Capex intensity $/t 1,500 1,000 500 - BHP (Jansen) Canadian mine BHP (Jansen) Eurochem K+
Slide 17: Updated Feasibility Study Reconfirms Muga's Strong Economics
Updated Feasibility Study Reconfirms Muga’s Strong Economics Updated capex numbers with NPV8 of €1.89 Billion More advanced engineering higher degree of accuracy: 25% IRR reconfirming a 30-year mine life1 phase 1 €398 million phase 2 of €209 million At current spot price Debt term sheet agreed for A
Slide 18: Muga Mine – Key Physicals and Financials
Muga Mine – Key Physicals and Financials 2 December 2021 CAPEX phase 1 (500,000 tpa MOP) €398 million CAPEX phase 2 (Additional 500,000 tpa MOP) €209 million Total CAPEX €607 million ROM tonnes 173.7 million tonnes Average plant tonnage feed rate 400 tph K2O grade 10.5% KCl recovery 91% LOM MOP prod
Slide 19: Status and Next Steps
Highfield 7 Resources STATUS AND NEXT STEPS
Slide 20: Muga Moving to Construction
Muga Moving to Construction 2021 2022 2023 2024 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Contract with construction partner Finalise procurement of process plant long-lead items Electricity line Authorisation Mining Concession Local town hall construction licenses Equity Debt term raise sheet agreed Finalise funding
Slide 21: Sustainability
Highfield 7 Resources SUSTAINABILITY
Slide 22: Industry Leading ESG Credentials
Industry Leading ESG Credentials • Environmental compliance and commitment through DIA award Environmental • Progressively rehabilitate mine: Backfilling and salt sales • Muga will be the only mine not to leave residue on the surface after production Factors • Strong local support in favour of the M
Slide 23: Appendix
Highfield 7 Resources Appendix
Slide 24: Current supply restriction making Muga even more strategically important
Current supply restriction making Muga even more strategically important % of Global Production • Russia and Belarus accounted for 38% of worldwide production in 2021, or about 27 Mt of potash. • With sanctions on Belarus starting to come into effect, and new measures targeting Russia’s economy due
Slide 25: Differential between MOP and SOP prices
MOP has performed strongly recently 900 250 Differential between MOP and SOP prices 800 • SOP has historically traded at a premium to MOP 200 700 • SOP is a ~7Mt market vs ~70Mt MOP market • SOP is used for speciality crops where as MOP is US$/t 150 600 used for stable bulk crops like corn, wheat an
Slide 26: Ore Reserve Statement
Ore Reserve Statement Highfield Resources Investor Presentation 26
Slide 27: ASX:HFR
ASX:HFR REGISTERED OFFICE 169 Fullarton Road Dulwich SA 5065 Australia SPAIN HEAD OFFICE Avenida Carlos III, 13-15, 1B, 31002 Pamplona, Spain T: +34 948 050 577 | F: +34 948 050 578 FURTHER INFORMATION Ignacio Salazar CEO T: +34 948 050 577 Olivier Vadillo Investor Relations T: +34 609 811 257
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